Obtaining a loan to pay for grad school?
Dear Deb:
I was accepted to grad school and I am convinced the MPA will be essential for my career. Unfortunately, I do not qualify for grants or scholarships. My parents paid for undergraduate studies for me and my three sisters. They are not paying for graduate school. Should I obtain a loan to pay for grad school?
Sincerely,
Terrence B., Santa Barbara, CA
Dear Terrence,
I trust that you’ve done the appropriate research to determine that you are preparing yourself for an occupation that is projected to be in demand when you graduate. I am also hoping you have researched schools to determine which school offers the value for the degree earned. Does the school have an excellent reputation and program to position you for your career? And, I am sure you have sought out sources outside those provided by the schools.
You said you did not qualify for grants or scholarships. It is certainly worth reviewing with a counselor at your prospective grad school. Ask about all “free money” options. Research teaching assistant or school-work programs that can provide partial funding of your expenses.
With all that covered, I would recommend that you carefully research student loan options. Educate yourself on the borrowing process, the risks, and ways you can save money over the lifetime of the loan. Do not sign anything, until you have done your research! Evaluate the interest rate, loan fees, and repayment schedules of each loan option. Consider federal programs such as Stafford loans. If you qualify, these could be smart options to consider.
An important factor when making your decision is borrower benefit. Borrower benefit programs help to reduce the cost of repaying your loan. Ask about the lender paying fees or if the lender will reward you by reducing your interest rate if you have made payments on time for a certain period. Also ask about penalties and what may trigger changes to your rates or fees.
Lastly, be careful when determining your loan needs. It’s very easy to over borrow the money and even easier to spend it. Paying it back can take ten or more years. So, triple check your figures and only borrow what you must.
If you have a question for Deb, please email debra@careersdonewrite.com. The Ask Deb column appears every Friday on our blog at the Careers Done Write website.